LONDON, July 18 British luxury car maker Jaguar Land Rover (JLR) is set to increase an 800 million pounds ($1.22 billion) loan refinancing after a strong response from lenders, banking sources said on Thursday.
The new loan will refinance existing debt and will also provide some new money after the deal is increased. The deal is being arranged by Bank of America Merrill Lynch, BNP Paribas and Standard Chartered.
JLR is part of India's Tata Motors and is rated BB-/Ba3. The loan has attracted support from existing banks and some new lenders, including Indian relationship banks of Tata Motors, the bankers said.
Tata Motors relies on JLR for the bulk of its profits, with the British-based company accounting for more than three-quarters of the Indian carmaker's revenue.
JLR reported a 7 percent rise in sales in June as it sold more cars in China, the company's fastest-growing market.
DUAL TRANCHE DEAL
The loan consists of a 200 million pounds, three-year revolving credit at 200 basis points (bps) over Libor and a 600 million pounds, five-year revolving credit at 250 bps.
Utilisation fees are also included of 15 bps for drawings up to 33 percent of the total facility, 25 bps for drawings up to 66 percent and 50 bps for drawings over 75 percent.
A commitment fee is also included of 40 percent of the margin on undrawn amounts. Fees range from 65-75 bps on the three-year tranche and 85-100 bps on the five-year tranche depending on the size of banks' commitments.
JLR agreed a 710 million pounds committed revolving credit facility in December 2011 which was increased to 795 million pounds in 2012.
Land Rover has a 116 million pounds borrowing base revolving credit facility, which was signed in November 2009 and is due to be repaid on November 11, 2014. ($1 = 0.6579 British pounds) (Reporting by Tessa Walsh)